Critereo in IBD

Found an old (6/25) IBD “New America” article on Criteo. Here is a summary.
Evolution of Targeted Ads Plays Into Criteo’s Strengths

Online purchases increasing, so marketers pressured to attract buyer’s attention. Criteo is a leader in targeted ads.

Revs have nearly tripled over last couple years with earnings growth projected at 31% or higher over next 3 years. Q1 earnings up 76% from prev year and topped estimates. They are top stock in IBDs "Commercial Services-Advertising industry group, but the group itself is ranked 111 of 197 groups.

Much of its biz focuses on leveraging lrge pools of data as a way of engaging and winning customerson behalf of ad clients. It’s algorithms predict the probability and nature of a user’s engagement with an ad. And they help tailor ads to the specific user interests. “Deep data integration”.

They have some of the best relationships in the industry, they access a company’s inventory and have access to ad supplies others don’t.

Criteo has a network of more than 10,000 publishers:Google and FB the largest. They have preferential access to Yahoo Japan’s inventory because Criteo drives incremental sales to them. (They can take demand from their 7800 ad clients and bring it to YahooJapan.) (Japan has high rates of mobile use and ads)

Customers that use CRTO to push ads are PayPal, Airbnb, Expeida, Macy’s, Priceline, L’Oreal,, Rakuten, Orange andNetshoes

CRTO claims 90% client retention rate Q to Q.

The also run e-mail ad offerings and in-app ads on mobile devices. (Yes, more of that crap we hate, but it must work).

The charge 40% commission. However, advertisers are trying to cut out the middle man and go directly to ad platforms on FB, Google, etc. That only costs the advertisers 10-20% instead of 40%, so that is a competition point for CRTO.

CRTO still is one of the most profitable and is growing well globally. Q1, 46% of reves from Europe, Middle East, and Africa (EMEA) 33% from Americas and 21% from Asia Pacific. growing fastest in US as it is the newer market for CRTO.

Was hurt when Apple said Safari will allow users to block ads.

Very high ratings in IBD’s measures:
Composite 95
EPS 98
RS 89
Sales+ProfitMargings+ROE = A
Accumulation/Distribution = A-